Sir Pipsalot's Monday Market Update 06-14-2010

Sorry for the impromptu hiatus on Friday. I wound up unexpectedly headed out of town. Anyhow, we've seen some really interesting shifts in the last couple of days, so there's a lot to update on.

The EUR/USD has broken through the 1.2100-1.2150 resistance area and looks poised to recover further to 1.2450ish. I'd look to get long on any dips to grab a good chunk of it. I'd say a long at 1.2155 with a 75-160 pip SL and a 100-280 pip TP makes sense. Pick a version of the trade that makes sense given your trading style. The bottom I tentatively started calling last Sunday Monday has definitely formed and broken the initial trendline resistance, so we're likely headed higher. At some point though, we'll likely head back down into the 1.1820-1.1995 support zone to reload and push back up again, but I think this has enough momentum to continue possibly to 1.2450.

In stocks, even Friday I was steadfastly maintaining that 1075-1085 was the ideal sell range for the S&P 500 futures, but with the risk appetite strengthening in markets over the last few days and over the weekend best characterized by the EUR/USD, and AUD/USD which tend to be leading indicators, and the gap up here to start off Sunday, things are looking like a more medium term retracement is at hand that will likely take us into the 1125-1150 range where a short would be more appropriate.

We may see some sort of dip today from current futures levels (ESM0 at 1095, ESU0 at 1090.50 as I type this), but either way I would look to cut off any short to medium term stock shorts and hold out to short at higher prices and even look to get long on dips. Longer term, we're still definitely tilted towards a more significant, but we need a decline below 1035 to confirm that more concretely.

There's no big news due out today, and in fact, it's quite a slow news week in general. We do get a few decent reports out of the US and UK though here and there, so I'll preview those as the day before each of them.

That's all for today's update. If you'd like to learn more about trading or trade along with myself and my collegues, come join us at Profit Mongers. Our subscription is very reasonable at $179 per month, and right now you can sign up for a 2 week trial to get started for only $29. This offer is for new customers only. If you have any questions, you can also email me at sirpipsalot@profitmongers.com

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